International Contagion



A widespread historical pastime is fixing the national location where a crisis starts. President Herbert Hoover insisted that Europe primarily was responsible for the 1930s depression because of its cartels and the ‘European statesmen [who] did not have the courage to face these issues’.1 There was global over-production of wheat, rubber, coffee, sugar, silver, zinc, and cotton. Hoover accepted some US responsibility for stock market speculation. Friedman and Schwartz asserted that the crisis originated in the United States, although the gold-exchange standard rendered the international financial system vulnerable. The initial climactic event — the stock market crash — was American, and the developments that led to a decline in the stock of money in late 1930 were predominantly domestic.2


Stock Market Stock Prex Capital Flow Bank Failure Real Estate Price 
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International Contagion

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© Palgrave Macmillan, a division of Macmillan Publishers Limited 2005

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